Ilknur Biyik
Commercial Director Egyptian Cotton Hub
ECH is now planning to expand globally
Egyptian Cotton Hub (ECH) is the marketing arm of the Cotton & Textiles Industries Holding Co, the largest public sector textiles company in Egypt which manufactures high quality, durable, and functional cotton products. The organisation aims to achieve the best utilisation of production capacity and to ensure sustainable profitability by focusing on innovative, trendy and quality products. Speaking to Fibre2Fashion, ECH Commercial Director Ilknur Biyik discusses the challenges faced by the Egyptian industry and the government’s textile industry renovation project.
How is the global demand for Egyptian cotton?
Just as the rest of the textile items, Egyptian cotton exports are recovering from low demand in 2020, and more commitments are being made.
Egypt met 95 per cent of its export commitments last season and we have started the current season with zero carry-over stock, which is a rare occurrence. It happened due to high demand created by the decline of the cotton stocks.
Despite the Russia-Ukraine conflict in Europe and its negative repercussions on global trade, Egypt succeeded in exporting (bagging orders) 50,000 tons of cotton by the end of February 2023 (closure of cotton marketing season), which is 75 per cent of its production this season.
What is the size of the global market for Egyptian cotton? At what rate is it growing?
The Egyptian cotton (the Egyptian variety) is harvested in Egypt. The main difference between the cotton that comes from Egypt and other countries like India, China and the US can be found in the length of the fibres. The plant that grows in Egypt provides longer staples, due to specific climate conditions.
The cultivated cotton area in Egypt reached 370,000 feddans (a feddan equals 1.038 acres) in 2022, compared to 90,000 feddans in 2014, which is an increase of 311.1 per cent.
If we look at the exports of Egyptian cotton, as a reflection to the size of the global market, we will notice that exports reached $219.5 million in 2021, compared to $161.6 million in 2020, with an increase of 35.8 per cent.
Which are your major markets for cotton, yarn, and home textiles?
India, Pakistan, the US, China, some EU countries, and Japan are the top importers of Egyptian cotton.
For yarns, most of the exports sales go to the European market like Italy, Turkey, Portugal and Germany, and some Asian countries like China and Pakistan.
The US has the highest share of Egyptian home textiles products due to the free trade agreement (FTA). Our home textiles are also exported to several EU and GCC (Gulf Cooperation Council) countries.
What is the annual production capacity at ECH?
ECH is the marketing and sales arm of the Cotton & Textiles Industries Holding Co, the largest public sector textiles company in Egypt. The production units related to the company are currently witnessing a development in infrastructure and new machinery is being installed. Post-development, the production units will have an annual capacity to produce 188,000 tons of yarns, 198,000 metres of fabric, and 50 million pieces of apparel and home textiles.
What are the major challenges that the Egyptian cotton and textile industry encounters?
There are numerous obstacles in Egypt’s textile industry that prevent the adoption of new technology aimed at reducing carbon emissions and the balanced use of natural resources. Some of them are:
•A large share of the high-quality cotton continues to be exported without further processing. This is a major problem given that the potential value addition of further processing compared to the export of raw cotton is estimated to range from 50 per cent (fine count yarns) to 471 per cent (fine shirting).
•Heavy dependence on imported raw materials.
•Lack of well trained and skilled labour in the textile industry.
•Insufficient incentives for expansion.
•The shortage of financing products to adjust the credit ceiling in line with the sector’s projects (because it is a huge investment and depends on expensive modern mechanisation).
•Lack of support mechanisms for research and development.
•The relatively high cost of production compared to competing products in the global market due to the high cost of energy from petroleum, gas and electricity.
What would be your suggestions to the government to boost this sector?
The Egyptian government has appointed the Ministry of Public Sector Business to take public owned facilities under a revamping project of €1.5 billion. By 2023, these facilities will have the technology, machinery and most effective production systems. The aim is not only to take Egypt to the global position it deserves within global textile industry, but also to give the domestic industry a momentum within the country. ECH will take the responsibility of supplying imported textile materials to local businesses, which will help the whole country to compete in the international market.
What are you doing to incorporate sustainability into your operations and products?
The new machinery that will be installed as part of the Egyptian textiles mega renovation project will apply new technologies targeting:
•Less water and energy consumption: Pad batch dyeing, heat-recovery systems, zero liquid discharge (ZLD) system
•A smaller carbon footprint: Eco-friendly nitrogen technology will be applied, and solar thermal systems are in the feasibility study phase.
•Less Solid Waste: There will be automatic dosing units for chemicals. Plastic drums will be disposed as hazardous waste, and plastic bags and carton board boxes will be disposed as recyclable waste.
The main objective of Egyptian Cotton Hub will be to introduce eco-friendly and sustainable products as part of local collections sold in own shops, and also export collections offered to international clients. These will include products made from recycled yarns or natural dyestuffs.
What new technologies and innovations are you working towards?
The government secured €550 million towards the latest machinery from leading EU manufacturers of spinning, weaving, dyeing and finishing equipment. The new set up will drastically improve the industry’s carbon footprint and overall level of sustainability and eco-friendliness.
What are the future plans at ECH?
ECH is now planning to expand globally—through exports, by the acquisition of top importers, or through franchising by launching new stores for our premium brand ‘nit’. Also, we’re working on the fulfilment of raw materials to the local textile companies to help in imports substitution.
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Published on: 28/11/2022
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.
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